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Consolidating accounts with different year ends

Consolidation also applies if the firm owns less than 50 percent but exerts significant influence over the way the subsidiary operates.Consolidating accounting reports means adding up financial-statement items proportionately to the parent-company’s ownership stake.A certified public accountant and certified financial manager, Codjia received a Master of Business Administration from Rutgers University, majoring in investment analysis and financial management. "Difference Between Consolidated and Consolidating Financial Statements" last modified September 26, 2017.Subsidiaries acquired during an accounting period It will be rare in practice for a subsidiary to be taken over on the same day as the first day of the financial year of the parent company so that the two accounting periods coincide.It is a requirement that the financial year-ends coincide after takeover.In the usual case of a subsidiary taken over during its financial year either proper final accounts can be specially prepared at the date of acquisition so that pre- and post-acquisition income can be distinguished or an apportionment can be made on a time or some other rational basis to determine the division of pre- and post-acquisition income.Examples include a balance sheet, statement of cash flows, statement of owners’ equity and a statement of profit and loss.

Consolidation and inter-group transactions As well as primary adjustments there arise several secondary adjustments which are commonly needed in consolidated accounts.

At the end of a financial period these two current accounts will be reconciled if they are not in agreement, using the same procedures as for branch accounts.

At 31 December the current account of P Ltd with its subsidiary shows a debit balance of £6000 and the current account with P Ltd in the books of S Ltd shows a credit balance of £4500.

The same procedure applies for cancelling out in the group accounts any inter-company current accounts.

Where a parent has regular transactions with its subsidiary, probably in the nature of inter-company purchases and sales, each company will maintain a record of its transactions with the other company.


  1. Financial information – 5 year review. Cash and cash equivalents at end of year 7 448 6 415 a Mainly relates to the partial disposal of L’Oréal shares.

  2. Consolidating accounts can. retirees need to determine how much to withdraw from their retirement accounts each year to ensure. in the end, could.

  3. Chapter 4 Consolidation As. • The titles of the accounts of the consolidating. the end of one period but not at the end

  4. Consolidated financial statements. Act.” 21 from consolidating certain subsidiaries which. Comparatives for the year ending 31 March2016 will

  5. Relevant information is provided by consolidating such subsidiaries and. When the end of the reporting period of the. EU IAS 27 FOR INFORMATION.

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